What’s an oil depot?

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An oil storage facility stores crude oil derivatives for further distribution to retailers and consumers. It has various storage areas, and can receive oil from tankers or pipelines. It may be owned by independent contractors or oil refineries.

The term oil storage facility refers to a facility that is specifically intended for the storage of crude oil derivatives which generally serves as a place from which products can be stored, awaiting further distribution to retailers and ultimately to consumers finals. As can be expected of any large industrial facility intended for this purpose, an oil depot usually has many storage areas for products which include tanks that can be constructed underground or above ground within the facility. As part of the strategic placement application, the oil depot can be built in close proximity to an oil refinery that processes or refines crude oil into different products which includes kerosene and other products such as diesel.

The process by which an oil depot receives oil is varied and does not depend solely on a single method. For example, depending on the location of the depot, it may get its oil supply from tankers, which are usually trucks equipped with tankers to enable them to transport oil from refineries to the particular oil depot that owns the oil consignment. In some cases, oil can be shipped from the refinery through the use of a direct pipeline that is fed from the oil refinery to specific points that eventually connect to the oil depot. Usually, gas station owners will purchase the oil from the depot and have it transported to their storage facility on the station premises. Sometimes, the oil depot will send their own tanker to deliver the oil at an additional cost, or the service station management will make their own arrangements regarding transportation, a process which will involve sending their own tankers to the depot to be loaded with oil.

An oil depot may be owned by independent contractors who simply lend the oil companies the use of their premises for material storage. Such locations may be desirable due to their strategic location in relation to the oil refinery. For example, a forward-thinking businessman might convert a property that’s conveniently located near an oil refinery into a storage facility, meaning the refineries will patronize them based on the perceived benefit. Oil refineries may also own such locations, or they may be owned by other corporate interests.

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